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PARRIS N. GLENDENING, Governor
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S.B. 763
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(h) (1) Subject to paragraphs (2) and (3) of this subsection, the reserve
investments of a life insurer may include ground rents in any state.
(2) For unexpired redeemable ground rents, any premiums paid must be:
(i) amortized over the period between the date of acquisition and
the earliest redemption date; or
(ii) charged off before the redemption date.
(3) For expired redeemable ground rents, any premiums paid must be
charged off when acquired.
(4) A life insurer shall carry redeemable ground rents purchased at a
discount at an amount not greater than the cost of acquisition.
(i) (1) The reserve investments of a life insurer may include collateral loans
secured by pledge of any security listed in subsections (c) through (h) of this section if
the current market value of the pledged security at all times during the term of the
loan is at least 10% more than the unpaid balance of the loan amount.
(2) Each collateral loan is subject to the power of the life insurer to
terminate it if the pledged security depreciates below 10% of the unpaid balance of
the loan amount.
(j) (1) For purposes of this subsection, real estate sold under a contract of
sale in which title is retained in the life insurer shall be classified as real estate.
(2) Subject to paragraph (3) of this subsection, the reserve investments
of a life insurer may include:
(i) real estate for the office and business purposes only of the life
insurer, except as authorized by subsections (g) and (h) of this section; or
(ii) property primarily for the use of employees or customers of the
life insurer for parking with or without charge.
(3) The equity value of all real estate held under paragraph (2) of this
subsection may not exceed 20% of the life insurer's total admitted assets.
(4) A life insurer may purchase and hold real estate under a foreclosure
of its own mortgages or a deed in lieu of mortgage foreclosure for not more than 5
years.
(5) Subject to paragraph (6) of this subsection, the Commissioner may
grant extensions for periods not exceeding 5 years each of the period within which
real estate may be held under paragraph (4) of this subsection, if the Commissioner
considers the extensions necessary to serve the best interest of the life insurer and its
policyholders.
(6) Before the Commissioner may refuse to grant extensions under
paragraph (5) of this subsection, an appraisal of the real estate shall be obtained. If
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